1 MBA (D) – Principles of Marketing – Group Marketers

Principles of Marketing

Marketing Plan

For

Nestle Every Day

(Outline)

Submitted to: Ms. Rabia Shoaib

Submitted by: Group - Marketers
- Saquib Hasan
- Shafqat Idrees
- Fouzan Rafi
- Hammad
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Product:

NESTLÉ® EVERYDAY® (Tea Whitener)

Manufacturing Company:

NESTLÉ Pakistan Limited

Executive Summary:

NESTLÉ® EVERYDAY® tea whitener was launched in 1992 to exploit the potential
offered by the tea whitening segment and to expand the overall powder milk market.
Owing to its focused positioning and convenience it offers, the product was a huge
success. In Pakistan, tea is a national beverage consumed in all walks of life.
Interestingly, Pakistani consumers pay more attention to the quality and blend of the
tea leaves than to the milk used in it. Given this environment, Nestle must be credited
for creating consumer awareness and generating a brand of milk specifically for use
with tea more than eighteen years ago. The brand has shown strong growth pattern
with a great promise in the future.

Current Marketing Situation:

Currently NESTLÉ® EVERYDAY® is a market leader in tea whiteners with a strong

customer percentage, but it now faces tough competition with following recent new
entrants:

Engro Foods - Tarang

Haleeb Foods - Candia

There are few others international imports also but they have insignificant market
share. The main concern is to maintain lead in the market and identify the market
opportunities to expand and increase its current share. Although in the ever growing
global market perspective, it is vital to retain maximum number of customer.
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Market Description:

The Pakistani consumer market & customers, both have a unique & dynamic
perspective, which is difficult to relate to other countries and cultures. The cultural
value and importance of tea are strongly rooted in both urban & rural population. The
use of milk in tea is a custom, a cultural norm which is different from tea’s origin,
where it is used rarely with milk (black tea). The taste spectrum is concentrated with
dairy milk, the tea whitener concept is still not excepted widely across the country.
NESTLÉ® EVERYDAY® being the local pioneer in this domain has successfully
developed taste for tea whitener and acceptability among the urban population. In
general, the tea whitener market can be divided into the following categories:

Corporate Sector (Offices & Companies)

Instant tea at stalls (made with tea bags)

Households (Mixed / kettle tea)

Product Review:

Main features are:

The brand is available in a variety of pack sizes ranging from 5 to 1000 gm.

The product is matchless in quality and has no match.

NESTLÉ® EVERYDAY® tea whitener, made from pure fresh milk gives you
that perfect rich taste that only specialized milk can, so you can enjoy
the same delicious cup of tea each time!
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For your convenience NESTLÉ® EVERYDAY® is available both in powder

and liquid forms.

NESTLÉ has introduced the milk powder which outshined others

because of its great taste, refrigeration; ready to drink, less volume,
more stable shelf life.

Competitive Review:

We live in a competitive world and must never forget that our customers have a
choice. If they are not reverent of quality and reduction cost. Success can never be
taken for granted. We must watch and learn from our competitors. If they do
something better, we must improve our own performance. We can achieve
competitive advantage through Quality.

Engro Foods - Tarang

Haleeb Foods - Candia

Nestle Pakistan envisions that the company should develop an extremely motivated
and professionally trained work force, which would drive growth through innovation
and renovation. Special training programs have been designed for employees at each
level to keep up with and develop this vision. The study concludes that Nestle has a
significantly high growth rate (36%) and has grown and developed at a high pace in
short span of time. On the other hand Haleeb has a market share of 28%. And
Engrofoods having 21% the major contributor toward this growth and development
are human resource, marketing and sales departments. The major contributor is its
appropriate strategy particularly its relationship with the social and environmental
sectors. Perhaps this is the reason that it in spite of being a multi-national has been
well accepted in Pakistani culture. There are ample chances of its survival in future.
Keeping new players such as Olper’s, and the old one’s like Haleeb, Nestle focused
more on advertising. Nestle have been experiencing a constant increase in cost with
raw material contributing the larger part of this increase. Haleeb is having their own
suppliers so the raw material cost is bit low. Nestle maintained its value of gross profit
margin around or above 30% to ensure that it has a strong control over its costs, and
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the efficiency of production. But on the other hand, Haleeb faced a bit of down fall
when Olpers introduced their campaign.

Channels & Logistics:

Distribution system of Nestle is one of major source of competitive edge over its
existing rivals. Nestle has its own distribution networks equipped with all necessary
transportation facilities. They transport their products at major ten regional sales
offices, which are situated at different cities of Pakistan. These sales office (distribution
centers) have their own vans with sales people who sell and transport goods to the
small retailers.

SWOT Analysis:

Strengths:

The greatest strength of nestle is that it includes a culture that is team focused and an
open door policy. Nestle focus on collectivism and performance orientation attitude
which encourages employees to work harder. Another thing is high level of market
share and that people all over the world trust and recognizes Nestle as a big brand
name. Strength is that people trust on Nestle. It looks at achieving higher volumes by
renovating existing products and innovating new products. Strength is that they are
low cost operators which allow them to not only beat competition but also edging
ahead operating excellence, innovation, renovation, product availability and
communication are major strengths. IT is an important aspect that people all around
the world are becoming more conscious about health, that’s why they
prefer Nestle.

The only brand in the area maintaining its quality and taste and having the
same impact on its customer

Economical

Pure Drinking Water in market (Free of chemicals)
Strong Brand Name

Weaknesses:

One major weakness of Nestle is that it is entering into markets that are already
mature and can give a tough competition to new entrants. Nestle Plain Yogurt has
proved to be a Nestle weakness because it has been unable to make its market place
in USA. But Nestle by analyzing the sensitive areas can overcome its weaknesses.

Communication is weak

Lack of Awareness
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Opportunities:

Nestle in Pakistan has a great opportunity for expanding its markets because in
Pakistan there is a large ready market of food and beverages due to trends of eating
and the increasing .I t also has opportunities largely in China and India as well.
Through proper marketing research Nestle can cash on to these opportunities.
Concentrating on these areas can increase sales Increase in product line

Threats:

Nestle is facing the threats by worldwide community due to its violation of

international marketing standards. Many conferences and campaigns have been held
against Nestle in this regard which can damage the name and trust of its customers.
Another threat is due to the increasing popularity of its competitor OLPERS in local
and international markets.

Segments are being shared by competitors

Uncertain conditions will effect the sales(diseases of animals)

Under cutting by competitors

Objectives & Issues:

The strategic priorities of Nestle Pakistan are claimed to be focused on delivering

shareholder value through the achievement of sustainable, capital efficient and
profitable long-term growth. Improvements in profitability would be achieved with
due respect to quality and safety standards at all times. In line with the above
objective, Nestle Pakistan aims at growing into a number one food company in
Pakistan in the shortest possible time with the unique ability to meet the needs of
consumers of every age group - from infancy to old age, for nutrition and pleasure,
through development of a large variety of food categories of products with highest
quality.

Marketing objectives are compatible with the overall corporate objectives of nestle.
Company’s objective is to be the world’s largest and best branded food manufacturer
while insuring that nestle name is synonymous with the products of the highest
quality.

Marketing Strategy:

The effective formulation of the marketing strategy depends on the proper match
between the three key elements:

Consumer

Quality
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Competition

Every product on the shelf, every service and every customer contact helps to shape
this image. A Nestlé brand name on a product is a promise to the customer that it is
safe to consume, that it complies with all regulations and that it meets high standards
of quality. Customers expect us to keep this promise every time. Under no
circumstances will we compromise on the safety of a product and every effort must be
made to avoid hazards to health. Likewise, compliance with all relevant laws and
regulations is a must and is not negotiable. People, equipment and instruments are
made available to ensure safety and conformity of Nestlé products at all times. The
effort is worth it. Companies with huge quality standards make fewer mistakes, waste
less time and money and are more productive. They also make higher profits. Quality
is our most successful product. It is the key to our success, today and tomorrow.